Leveraging Platforms to enable your start-up to scale

A startup often wears the title of ‘scrappy’ as a badge of honour. This adjective encompasses the hustle, agile approach to business that is embraced by entrepreneurs who are embarking on their business journeys, with small teams and little cash. Although I do agree that this description is endearing, the Godfather of Agile suggests that adopting the mindset of a ‘grownup’ is essential in propelling your business forward.

The Godfather of Agile is Nigel Dalton, a social scientist in the Digital Transformation and Operations Team at global technology consultancy Thoughtworks. His first appearance on Platform Diaries was an excerpt from my research phase of ‘The Platform Owner’s Guidebook’, where we discussed the art of implementing complex systems.

In this episode, however, I wanted to chat to Nigel about the importance of strategy and the ‘growth-mindset’ that it takes to achieve scale as a business.

“We often say that timing is the secret of good comedy… timing is the secret of growing a business. When you get to a moment and you think ‘I wish I had done that, you’re too late. This is what catches growing companies,” Nigel shares.

Embarking on the startup journey presents challenges, such as demonstrating a demand for your product and communicating its longevity to investors or potential customers. But Nigel presents that this is not the time to neglect broader, long-term business goals. This ‘playing up’ mindset will ensure that you’re ready to scale, which can often catch startups by surprise.

“You don't necessarily need the backend tools, the supporting security and whatnot, but one day, you will… it can feel unintuitive to do so at the beginning, but you really need to be one step ahead.”

Plenty of startups succeed in scaling their product, however, scaling their business is a different kettle of fish. So, what should startups consider?

“Covid revealed a lot. I think if your startup is going well, then you should start to consider knowledge management. This was emphasised when working from home when you couldn’t walk up to the ‘neckbearded expert’ in that particular field”.

Knowledge allows for the customer support experience to continue to thrive. This type of forward-thinking, as well as leveraging platforms, ensures that your scale-up can occur seamlessly and should be a consideration for these ‘scrappy’ startups. So who should they be looking up to for inspiration?

“We are both gentlemen of a certain age who have watched the Australian e-commerce sector grow up,” Nigel says with a laugh. “I’m fascinated by the companies like CarSales and Seek, the wonderkids of the WEB 2.0 World, who are coming back to the table and re-evaluating whether they are meeting their customer’s needs.”

Looking at the 20-year-old digital businesses, you can see them begin the cycle that startups are only just starting (just at a much larger scale). The concept of continuous improvement is something that has been discussed on Platform Diaries before. The idea that if you are no longer innovating or developing, you are going backwards, is relevant in any stage of the business life cycle.

Nigel believes that this has a lot to do with the Western mindset surrounding lean enterprise.

“If I could do one thing, it would be to eliminate the word transformation from the vocabulary of Australian business people. It suggests that change is one time only but in reality, you need an attitude of continuous improvement.”

Considering what it takes to ensure there is continuous improvement in your business will ultimately lead to a phenomenon that humans tend to dislike: change. These changes are fuelled by decisions, which are only becoming more difficult as technology advances.

“I’ve got this picture of what choices you had for customer management in 2011. I can name Salesforce, Microsoft, and Sage. Now there are something like five and a half thousand options to navigate through.”

The selection of platforms is daunting for any business, let alone a startup who may feel financially precarious.

“There’s a certain amount of human embarrassment involved in having to go back to your CEO or board and say, ‘we need another quarter of a million for a system’, especially if you’ve already got one. The core nightmare is making the wrong choice and if you’re a little startup you might angst over that.”

Nigel recalls hearing Josh Arnold speak at Agile Australia in 2017 about the concept of ‘cost of delay’. While it is a relatively complex concept, it is intended to communicate the impact of time on the outcomes we hope to achieve.

“When you are doing something that feels like a shortcut, there is a good chance you will have to compromise for it later,” Nigel argues.

On the flip side, making these decisions earlier in your startup journey is generally cheaper and less strenuous than when your business reaches unicorn. In fact, it may be the difference between getting there sooner rather than later or at all.

Speaking of finances, Nigel also spoke of the challenges of an accountant’s role in agile businesses.

“Accountants are in a very liminal phase in organisations. Once it was very black and white, very precise… It's never going back to a world where you could manage a three-year budget or a five-year business plan where you move a couple of hundred each quarter.”

While finances present as the major challenge for any startups, Nigel’s advice can be distilled to this: act early to avoid more extreme costs in the future, and don’t allow the fear of making the wrong decision stop you from making any at all.

I had to know what the Godfather of Agile predicted was next for this highly complex, everchanging space.

“I think there's an elegance at being good at running stuff. Both the Maintainer Movement and the Right to Repair Movement have become enormous, and their ideas are that running things well becomes the source of your next ideas and innovation. It also has the great benefit of making your company profitable.”

During an investor conference I attended in March in Sydney, I listened to an interesting panel discussion about Web 3.0 and Blockchain. One panelist cautioned constraining our thinking about the future of tech by trying to draw parallels to things that already exist is missing the point. Innovation will look entirely different to anything we have seen before because it will be built on technology that’s just emerging; unlike Web 2.0 that leverages tech from the 80’s and 90’s.

This prompted Nigel to consider the new generation of employees: Generation F.

“I am super optimistic about Generation Fortnight. These kids are learning a skill set I never learned from Space Invaders at the fish and chip shop. They don't differentiate between playing Minecraft and watching a YouTube video on how to solve this problem in Minecraft. The difference between working and learning among this generation is becoming increasingly blurred, which could improve the mindset of my generation.”

Nigel spoke about the collaboration, strategy, communication skills our younger generation was learning by playing these interactive games. A message to take away from this is that although startups can look to the established businesses as inspiration, there is impending change.

Are you a startup who hasn’t looked too far ahead? Or perhaps you’re feeling slightly paralysed by a complex business decision? Nigel offers some sage advice to those embarking on this journey, and what the future may look like for businesses.